Formosa Petrochemical announces diesel price hike for next week

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Taipei-Formosa Petrochemical Corp., a private fuel supplier, said Saturday that it will raise prices for its diesel in the domestic market but will leave gasoline prices unchanged for next week after international oil prices moved in a narrow range this week.

A decision by major global oil producers to extend a current output reduction agreement boosted energy traders' sentiments and offset worries over a global oversupply, paving the way for a slight increase in crude oil prices, the company said.

As a result, Formosa Petrochemical has decided to raise its diesel prices by NT$0.1 (US$0.0033) per liter but to maintain its gasoline prices for next week, effective from 1 a.m. Monday.

This week, the company raised both diesel and gasoline prices by NT$0.1 per liter.

After the latest adjustments, prices at Formosa Petrochemical gas stations islandwide will rise to NT$23.8 per liter for super diesel but prices for 92 octane unleaded, 95 unleaded and 98 unleaded will stay unchanged at NT$26.2, NT$27.6 and NT$29.7, respectively, the company said.

Crude oil prices moved higher after the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC producers, led by Russia, agreed to extend a production cut agreement by nine months to the end of next year.

The extension, which had been widely expected by the market, mitigated lingering worries over an oversupply to help the oil market recoup its earlier losses caused by an increase in gasoline inventories in the U.S. market.

According to the U.S. Energy Information Administration, gasoline stockpiles were up 3.6 million barrels for the week to Nov. 24, while distillate inventories, which include diesel and heating oil, also rose 2.7 million barrels.

Due to the small fluctuations in crude oil prices, Formosa Petrochemical's main competitor, state-owned CPC Corp. Taiwan (??), is expected to announce similar price adjustments for next week at noon Sunday. CPC calculates its weekly fuel prices based on a weighted oil price formula made up of 70 percent Dubai crude and 30 percent Brent crude.

As of Thursday, the average price of crude oil was listed on CPC's website at US$61.79 per barrel, up US$0.35 per barrel from the previous week.

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